Continued from page 1

The money that the Palestinians say has not been delivered includes $200 million from the U.S. in budget support that is being held up by Congress. The Palestinians say the United Arab Emirates cut aid from $174 million in 2009 to $42.5 million since the beginning of 2011 in an attempt to pressure Palestinian president Mahmoud Abbas to reinstate a disgraced former aide. And Qatar, another rich Arab state, has linked aid to elusive reconciliation between Abbas and the Gaza Strip’s Hamas rulers.

The annual budget is set at nearly $4 billion, with half of that intended to pay 154,000 civil servants, said economist Samir Abdullah, a former Cabinet minister. Government salaries are the backbone of the Palestinian economy in the West Bank.

Donor dollars are crucial because Palestinians have an economy hampered by Israel’s control over the West Bank’s borders as well as limited movement inside the territory. Security checks over exports and imports hamper the ability of Palestinian manufacturers to buy cheaper products elsewhere and raise the price of exports.

What’s more, Israel still directly controls some 60 percent of the West Bank, where 340,000 Israeli Jews live in settlements deemed illegitimate by the international community.

Associated Press writers Nasser Shiyoukhi in Hebron, Mohammed Ballas in Jenin, and Ibrahim Barzak in Gaza City contributed to this report.